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This bill would give certain insurance companies a federal tax break after a major federally declared disaster. For the first five tax years after the disaster, insurers that already covered property in the affected area could leave some of their income from that property insurance out of taxable income. The goal is to help keep or restore homeowners’ and property insurance coverage in disaster-hit areas, where insurers may otherwise pull back or raise costs.
- The tax break applies only to insurance companies other than life insurers that were already providing real property insurance in the disaster area before the disaster happened.
- The excluded amount is the company’s income from premiums for property insurance in the disaster area, after subtracting related deductions.
- “Property insurance” can also include personal property coverage if it is part of the same policy as the real property coverage and the personal property is on that property.
- The rule would apply only to disaster areas with an incident date after December 31, 2024.
Official Summaries
Restoring Competitive Property Insurance Availability Act
This bill allows certain insurance companies to temporarily exclude premiums paid for real property insurance on property located in a federally-declared disaster area from the company's gross income for federal tax purposes.
Specifically, under the bill, an insurance company (other than a life insurance company) that provided real property insurance immediately prior to a federally-declared disaster for property located in the disaster area may exclude from gross income (1) the amount of premiums paid for such insurance, minus (2) any tax deductions properly attributed to such premiums. Further, such premiums may be excluded for the first five tax years ending after the date of the disaster.
Current Full Text
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1070 Introduced in House (IH)]
<DOC>
119th CONGRESS
1st Session
H. R. 1070
To amend the Internal Revenue Code of 1986 to exclude from gross income
certain income from providing real property insurance following certain
federally declared disasters.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 6, 2025
Mr. Higgins of Louisiana introduced the following bill; which was
referred to the Committee on Ways and Means
_______________________________________________________________________
A BILL
To amend the Internal Revenue Code of 1986 to exclude from gross income
certain income from providing real property insurance following certain
federally declared disasters.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Restoring Competitive Property
Insurance Availability Act''.
SEC. 2. EXCLUSION OF CERTAIN INCOME FROM PROVIDING REAL PROPERTY
INSURANCE FOLLOWING CERTAIN FEDERALLY DECLARED DISASTERS.
(a) In General.--Part II of subchapter L of chapter 1 of the
Internal Revenue Code of 1986 is amended by adding at the end the
following new section:
``SEC. 836. EXCLUSION OF CERTAIN INCOME FROM PROVIDING REAL PROPERTY
INSURANCE FOLLOWING CERTAIN FEDERALLY DECLARED DISASTERS.
``(a) In General.--In the case of each taxable year in the recovery
period, there shall be excluded from the gross income of each specified
insurance company the qualified real property insurance income of such
company for such taxable year with respect to any disaster area.
``(b) Specified Insurance Company.--For purposes of this section,
the term `specified insurance company' means, with respect to any
disaster area, any insurance company (other than a life insurance
company) which, immediately prior to the incident date with respect to
such disaster area, provided real property insurance with respect to
property located in such disaster area.
``(c) Qualified Real Property Insurance Income.--For purposes of
this section, the term `qualified real property insurance income'
means, with respect to any specified insurance company for any taxable
year, the excess of--
``(1) the premiums received by such insurance company for
real property insurance with respect to property located in the
disaster area, over
``(2) deductions properly allocable to such premiums.
``(d) Real Property Insurance.--For purposes of this section, the
term `real property insurance' shall include the coverage of risks
associated with personal property if such risks are covered under the
same policy that covers risks associated with real property and such
personal property is located on such real property.
``(e) Recovery Period.--For purposes of this section, the term
`recovery period' means, with respect to any disaster area, the first 5
taxable years ending after the incident date with respect to such
disaster area.
``(f) Disaster Area.--For purposes of this section, the term
`disaster area' has the meaning given such term in section 7508A(d)(3).
``(g) Incident Date.--For purposes of this section, the term
`incident date' means, with respect to any disaster area, the earliest
incident date specified in the declaration with respect to such
disaster area.''.
(b) Clerical Amendment.--The table of sections for part II of
subchapter L of chapter 1 of the Internal Revenue Code of 1986 is
amended by adding at the end the following new item:
``Sec. 836. Exclusion of certain income from providing real property
insurance following certain federally
declared disasters.''.
(c) Effective Date.--The amendments made by this section shall
apply to disaster areas the incident date (as defined in section 836(g)
of the Internal Revenue Code of 1986, as added by this section) of
which is after December 31, 2024.
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